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Department of Justice—With the Help of Whistleblowers—Continues to Vigorously Pursue Cases of Fraud Against the Government

Earlier this month, the Acting Assistant Attorney General for the Department of Justice Civil Division, Chad Readler, reiterated the government’s commitment to combating fraud. More

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Materiality after Escobar: Why Government Behavior after a Defendant Presents a False Claim Is Not Dispositive

In Universal Health Servs., Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989 (2016), the Supreme Court resolved a circuit split over the implied false certification theory of liability under the False Claims Act (FCA). As opposed to express false certification, where the defendant allegedly has made an affirmative false statement regarding its compliance with underlying statutory or regulatory requirements, implied false certification is based on the defendant's failure to disclose its noncompliance with these requirements. In Escobar, the Court upheld implied false certification as a valid theory of liability under the FCA, but tightly circumscribed its scope through a "rigorous" interpretation of the Act's materiality and scienter requirements, holding that "[a] misrepresentation about compliance with a statutory, regulatory, or contractual requirement must be material to the Government's payment decision in order to be actionable under the False Claims Act." Escobar, 136 S. Ct. at 1996. More

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Government and Whistleblowers Bring More False Claims Act Cases in 2017

The current administration recently made it clear that it will continue to vigorously investigate and enforce the law prohibiting attempts to defraud the government.  False Claims Act (FCA) lawsuits continue to trend upwards as the Department of Justice files a second complaint against UnitedHealth Group Inc. (UHG) within two weeks.  This development follows on the heels of the prior complaint, United States ex rel. Swoben v. Secure Horizons, which outlined allegations that UHG defrauded Medicare programs with false claims for payment. More

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Recoveries For FCA Claims Involving Fraud in 2016

In 2016, whistleblowers filed 702 qui tam suits and the Department of Justice recovered $2.9 billion in False Claims Act lawsuits initiated by whistleblowers.  In  qui tam lawsuits, whistleblowers, or “relators,” are entitled to receive up to 30% of the recovery.  And in 2016, whistleblowers recovered $519 million. More

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Do I Have Enough Information To Be a Whistleblower?

If you have information about fraud being committed against the government, you might be considering whether you have enough information to state a claim under the False Claims Act. It can be challenging to know whether you have enough information to bring a qui tam suit, but generally, you need to meet the following requirements to successfully file a claim under the False Claims Act: More

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2017 FCA Non-Compliance Trends Emerging at Hospitals

The Office of Inspector General (OIG), as part of the Department of Health and Human Services, plays a critical role in maintaining the integrity of the Medicare and Medicaid programs. Each year, the OIG releases a Work Plan that highlights its priorities and emerging issues in detecting and preventing fraud, waste, and abuse in the Medicare and Medicaid programs. More

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How the Government Gets Involved in False Claims Act Cases?

The False Claims Act (FCA) is designed to help prevent fraud against the federal government. The FCA allows the government to pursue claims against individuals or entities who defraud the government or government programs. More

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The Federal Defend Trade Secrets Act (DTSA)

The federal Defend Trade Secrets Act (DTSA) became effective in May of 2016.  Pub. L. 14-153 (05/11/2016).  In addition to providing for liability against those who illegally disclose trade secrets, the DTSA contains a counter‑balancing provision that immunizes from liability whistleblowers who disclose trade secrets to government officials or counsel for the sole purpose of reporting a violation of the law.  18 U.S.C. § 1833(b)(1)(A).   More

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Trinity Appeals $663M FCA Guardrail Judgment to 5th Circuit Court

On December 7, 2016, the Fifth Circuit Court of Appeals heard argument in the case of The United States ex rel. Harman v. Trinity Industries, Inc., et al.  At issue was a nine-figure judgment which Joshua Harman obtained on behalf of the United States and other state governments against Trinity under the federal and related state False Claims Acts.  The jury found that Trinity had submitted knowingly false claims for payment for its highway guardrail products.  The falsity stemmed from the fact that Trinity had made changes to its guardrail product in order to save money but consciously concealed those changes from the Federal Highway Administration, thereby rendering the products ineligible for payment. More

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Federal Ban on Higher Education Incentive Compensation for Student Recruiting: A $4.29M False Claims Act Settlement

Title IV of the HEA (Higher Education Act) bans universities and colleges from paying incentives to employees, including recruiters, for securing enrollments. To obtain federal funding, colleges and universities must enter into a Program Participation Agreement with the U.S. Department of Education (USDOE), promising, among other things, to comply with the incentive compensation ban. The ban prohibits any form of incentive compensation, including bonuses, promotions and pay raises based on success in recruiting students to the school. The purpose of the ban is to prevent schools from creating a "boiler room" atmosphere, where overzealous recruiters "sell" students on their school, regardless of whether it is a good fit for the student. In June 2015, the U.S. Department of Education announced that it would enforce these rules more closely. More

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